The Hindu : Front Page : Helicopter deal: fresh request for proposal soon

Online edition of India's National Newspaper
Friday, Dec 07, 2007
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Helicopter deal: fresh request for proposal soon

Sandeep Dikshit

Government prefers the safer option of cancelling the tender for 200 helicopters

Fallout of fight between Bell and Eurocopter
First request proposal made in 2001 for replacing Cheetah and Chetak helicopters

NEW DELHI: The Union government preferred the safer option of cancelling the tender for 200 helicopters after the two-way fight for the Rs.1,700-crore order turned vicious.

Defence Ministry officials had been expressing misgivings about the tender process even as the two companies in the fray — Bell and Eurocopter — did not refrain from highlighting what they said were deficiencies in each other’s machines. In fact, soon after Bell was disqualified on technical grounds, it mounted intense diplomatic pressure on India, for re-inclusion in the tender process on grounds of unfair exclusion.

“The government has decided to cancel the ongoing request for proposal (RFP) for procurement of 197 helicopters for the Indian Army,” said Defence Ministry spokesperson Sitanshu Kar. “A fresh RFP will be issued shortly,” he added.

The Ministry launched its first RFP in 2001 for urgent replacement of the Cheetah and Chetak helicopters, which had been in use for 40 years. In February this year, Eurocopter appeared to have won the race but the Government put the deal on hold to scrutinise allegations regarding the role of two Generals and a senior bureaucrat in pushing the deal for the Franco-Italian-German consortium.

The Ministry examined charges that a former General headed the tender examination panel while his elder brother, also a retired General, worked for another private firm dealing with helicopters. A middle-level bureaucrat was said to have been hosted with his family in Europe by one of the companies.

Each helicopter was estimated to cost between Rs.85 crore and Rs.90 crore. While 60 helicopters would have been directly imported, 137 were to be built by the public sector Hindustan Aeronautics Limited under a transfer of technology agreement. Sources in the Ministry suggested that the Eurocopter machine was not the same as the one it named in the technical offer and they referred the case to the Central Vigilance Commission, which also felt the rules were flouted. The direction to re-tender was issued after these investigations.

However, Eurocopter claimed that the helicopter presented during the trials was identical to the one proposed to the Indian Army and all trials conducted with utmost transparency and professionalism. Besides no irregularities were identified by the Defence Ministry’s Technical Oversight Committee (TOC) which verified the evaluation procedures prior to final selection, the company contended.

“The AS350 B3 civilian version presented by Eurocopter in India is exactly the same helicopter as the AS550 C3 military version in terms of airframe, systems, main gear box, rotor head, blades, engine and performances. In the same manner, Bell has presented its civil version the B407 for trials in India. The Army will use different configurations of the helicopters as per the operational missions. The mild differences between these configurations such as structural reinforcements and hard points for armaments carriage were not yet defined before trials. In July 2005, the military versions of the short-listed aircraft were demonstrated and tested on ground and in flight by the Army evaluation team and MoD representatives during fact-finding visits that occurred within the OEM’s facilities in France and the U.S.,” the company said.

In regard to the allegations relating to the involvement of middlemen in the project, Eurocopter said it fully complied with French and European regulations on these issues. It signed the pre-Integrity Pact that was requested by the Ministry of Defence.

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